The ‘Amazon Way’ of Strategy
It’s December 1, 1976, and the Sex Pistols are being interviewed on live television.
Appearing on the British Today show at the supper hour, the Pistols’ frontman John Lydon (Johnny Rotten) responded to interviewer Bill Grundy’s command, “Say something outrageous,” by calling him a “dirty fucker” and a “fucking rotter.”
The newspapers put the Sex Pistols on the front page for a week with screaming headlines like “TV Fury Over Rock Cult Filth” and “Punk? Call It Filthy Lucre”. Members of Parliament denounced them.
“Anarchy in the U.K.” entered the charts at Number 43, but record company executives refused to handle it as EMI was fast buckling under the public pressure. The Pistols added to the outrage by refusing to apologize, and by doing long interviews in which they denounced the entrenched system of music ratings and sacred luminaries like Mick Jagger and Rod Stewart. They went on tour, traveling around the United Kingdom in a bus, arriving at gigs only to discover that they had been banned in the township. Out of twenty-one scheduled dates, the Sex Pistols played three.
So incendiary was their impact at the time that in their native England, the Houses of Parliament questioned whether they violated the Traitors and Treasons Act, a crime that carries the death penalty to this day. The Pistols would inspire the formation of numerous other groundbreaking groups, and Lydon would become the unlikely champion of a generation clamoring for change.
“No regrets,” proclaimed Malcolm McLaren, the Sex Pistols’ infamous manager, after the swearing-on-TV incident. “These lads … want a change of scene. What they did was quite genuine.” Here’s the clip:
There are as many theories about why punk rock came to be as there are punk-rock progenitors, but like all good revolutions, this one was born out of deep discontent with the times. It was propelled by technical accessibility and entrepreneurship: it was simple and easy to pull off by pretty much anyone. In December 1976, the English fanzine Sideburns published a now-famous illustration of three chords, captioned “This is a chord, this is another, this is a third. Now form a band.”
Punk was hardcore Zen, a completely different operating philosophy that undermined the integrity of the culture in which it was introduced. It altered what was meant by a ‘new industry model’, changing those deeply embedded habits of thought which give a system its sense of what is the natural order of things.
Or to frame it in terms of today’s lexicon, punk was…innovative…disruptive….transformative. Nothing was sacred. You could lose yourself in a reactionary had-it-up-to-here fury while also fully savoring the rupture, the novelty of the moment as a cathartic split from convention and cliche.
Punk was a completely different wattage.
Outcomes First, Inputs Second
Jeff Bezos stepped down from Amazon on Monday (July 5) — exactly 27 years after he founded it. His replacement is Andy Jassy, who is best known for inventing Amazon Web Services (AWS), the cloud computing business which makes up almost 60 percent of Amazon’s operating income.
In the nearly three decades that he led Amazon, Bezos developed a series of unusual leadership principles — which some argue are the backbone of his success. Talk to anyone who’s ever worked there, and you don’t have to wait long before you hear the phrase “customer obsession” as the why behind the business. For a company to be successful it had to have happy customers — at almost any cost.
From the BBC’s reporting on Bezos setting down:
Nadia Shouraboura started working for Amazon in 2004. She went on to be invited into the elite “S-team” of Amazon managers — the senior managerial board. But when she first started, she thought she was going to be immediately fired.
“I made the biggest mistake of my life during our Christmas peak,” she says. Shouraboura had ordered key products onto warehouse shelves that were too high. It would take time and money to get the right products off the shelves.
“I came up with a clever way for us to lose as little money as possible, and sort of fix the problem. But when I talked to Jeff about it he looked at me and said, ‘you’re thinking about this all wrong’.
“You’re thinking how to optimise money here. Fix the problem for customers, and then come back to me in a few weeks and tell me the cost.”
Critics say many of today’s health system CEOs have proved unwilling or unable to shift their market strategies to meet the demands of consumers accustomed to rapid, high-quality service in other industries, the kind of ‘consumer-grade experience’ that Amazon has managed to turn into a nearly $400 billion business. Writing in Modern Healthcare (“As Healthcare Changes, Systems Need to Broaden Search to Find Disruptive CEOs”), Harris Meyer describes the pressure on CEOs to find a modern strategy, one that can adapt to a total change in context for business.
Incoming executive leadership, Meyer says, need a new frame of reference for how hospitals, pharmaceutical and medical device companies, and other delivery systems will be “transformed in the coming years into very different-looking organizations whose focus is on [collaborative business models] that keep patient populations healthy in the most cost-effective ways.”
“With healthcare changing rapidly, hospital CEO positions turning over at a high rate, and baby boomer senior executives eyeing retirement, some hospitals and health systems realize their next leaders will need a different set of experiences and skills to successfully navigate that new world.”
They’re in need, it seems, of a Punk Rock vision, a radically different mindset that can navigate the transition and tension between entrenched and emerging modes of being.
The thing missing from the conventional perspective is new understanding: the pieces matter less than the whole, “things” are secondary to experiences. The new business value to extract from healthcare is not from the discrete use of applications or the latest cool tech pilot, but the way these components can meld together to interact and form a broader architecture for managing information.
Quoting CVS Health CEO Larry Merlo:
“[Industry] does not place enough of a focus on outcomes or managing the patient in a holistic way, and all of that leads to — pick the adjective you want to use — wasteful, avoidable, preventable spending that amounts to billions of dollars.”
There are multiple billion-dollar business models and markets to develop based on improving outcomes and squeezing inefficiency from healthcare. The path to get there is to make technology so immersive that it disappears into the experience.
A Biological Orientation
The ‘Amazon Way’ of strategy is about sustaining a circle of becoming, an autocatalytic set inflaming itself with its own sparks, where the organism behaves as environment, and the environment behaves as organism.
It’s a biological orientation.
Their ecosystem seeks only to enlarge itself through ‘progressive integration’ of markets and industries and technologies in a circuit of self-making, where the parts aggregate themselves into its own economy.
The only way to compete against Amazon (or China, for that matter), or to complement and co-evolve with them, is by understanding how to create and communicate with systems thinking.
The next healthcare solves for outcomes with strategy and imagination at a system level.
Winners have better system vision, and are able to position themselves as keystones in new industry ecosystems, capable of serving and sustaining a ‘patient-to-consumer loop’ that connects the clinical setting and community setting in a cycle of health production. And if you buy into the logic that it’s not just one thing that improves outcomes, but an infinite number of things simultaneously and interactively, then “value” in healthcare is better understood as a flow, not an end state.
Fragmentation in healthcare is a design problem: there are islands of features everywhere from too many vendors wandering on the edges, pushing point solutions to small problems. The challenge is pulling it all together in a way that a whole system is born and becomes focused on generative value. The new data that flows from this new system, and then refined into specialized cognition, is the thing that generates new business value, supports population health and guarantees performance.
Data on purpose. You design for the analytics you want to capture.
Or to put it another way, the transformational remit for today’s health market leaders is the ability to creatively explore and conceptualize a new territory, quickly assemble the intellectual viewpoint, and then design the new industry infrastructure — the nervous system — to own the space. Which is the role of “digital” in this story. It’s value is expressed in the ability to dissolve boundaries, create new identities, remove friction and re-configure entire business systems, practically overnight.
Anger is An Energy
From the publisher’s note to Anger is an Energy, John Lydon’s autobiography:
“This autobiography is by John Lydon in his own words. Sometimes, the organization of those words does not conform to the traditional rules of grammar. In some cases, the reader will happen upon words not listed in the dictionary, or used in ways one might describe as “unorthodox.” The publisher is aware of this — they are not typos or misspellings we have missed; they are part of Mr. Lydon’s unique “lingo” and, as such, have been given (mostly) free rein. As John might say, “Don’t let riffles cause fraction.”
We are now in the 50th year of the official US healthcare “crisis.” For more than half a century, ballooning health care costs have been a source of concern, confusion, complexity and impending catastrophe to the American economy and employer operating margins when, on July 10, 1969, President Richard Nixon proclaimed, “We face a massive crisis in this area.” Without prompt administrative and legislative action, he added at a special press briefing, “we will have a breakdown in our medical care system.”
A Punk Rock vision breaks from the herd of independent minds passing as disruptive. It’s about a shift in how to think, not in what to think. It’s about using new words to think new thoughts.
Here in this interview yesterday with the Financial Times, Jassy underscores why finding, and sustaining, a Punk Rock ethos of disruption is elemental to market innovation:
“[One] thing that happens over time as companies get larger is sometimes they move from that insurgent mindset into more of an incumbent mindset,” Jassy says here. “And they settle for things that are good enough.”
“I feel very strongly that we have to keep inventing and betting in a significant way, and we will.”
Sometimes it pays to go full bore against the grain.
/ jgs
John G. Singer is the Executive Director of Blue Spoon Consulting, a global leader in strategy and innovation at a system level. Blue Spoon was the first to apply system thinking to solve complex market access and integration challenges in the pharmaceutical industry. He does not have a financial relationship with Amazon.
